>> china devalues. its currency dropped sharply. >> chinese stocks surge on the news of the greenbacks surge against the dollar. >> google transforms itself into as it searches for a new future. good morning, everyone. welcome. two massive stories this morning. you have got what is happening story.a and the google

text a record move in terms of the yuan. the dollar peg has been there for some time. you can see that clearly in the chart. usingre going to start the market as a mechanism. it is going to be interesting because it will have a big affect. you mentioned the story against the dollar with the euro, with the yen. it is going to be interesting. how does the fed react to that? reservewill become a currency. >> google is front and center. becoming a holding company. >> only if you are a

stockholder. this is still google. also in the car area and the future of heating. >> you made a good point. in some ways berkshire hathaway is becoming google. this chinaabout story a bit more. let's talk about what the mere -- the market reaction may be. hong kong and find out what is going on here. >> take a look at these markets. it is a significant announcement bythe chinese, downgrading the most in two decades. you will see limited moves in

terms of market moving to the upside. the dollar you on, there you have it. check out the shanghai composite, down today. we had such a significant move to the upside. a 10% move to the upside. the enterprise index has chinese shares doing well. we will watch this very closely. a significant move by the people's bank of china. ofwill determine the course how investors look at china going forward. it is something the international markets will be

following closely today. >> that is the market reaction. let's talk about what this actually means. caroline: moves have been made to devalue the yuan for the most in two decades. for chineseis mean exports? are we really going to see a 1% devaluation? >> i think you have a real bump in exports. what it does reflect is a broad concern about china's lesser competitiveness in international markets. the export numbers over the 8.9% and wereown so bad. then you have broader economic indicators with the government's growth target of 7% by the end

of the year. it does reflect concerns the market wants to make it more competitive again as it loses ground. >> let's talk about motives. the currency has depreciated quite a lot. what is behind this move to incorporate the market? >> it does say a lot for how tightly managed china's currency such at the change is huge news. the government is saying this is giving the market a greater has beent the yuan under deflation pressure. this is allowing the market to play a greater role. the other hand, it is a very convenient reason when it will obviously help chinese growth.

exports will get a boost. chinese goods will be more competitive. it serves those ends. to see which one is reform or theity, chinese economy by the end of the year. caroline: thank you very much indeed. talk about going to google, but we are focusing on china right now. we have economic data. the slowdown appears to be deepening. for furtherst calls sanctions. welcome to the program. in some ways we should have anticipated this. the economy has been strengthening. why have they done this? >> nick mentioned growth being the target. case, believe that is the

it is looking at real data. ratepoints to a great closer to three and a half percent. they have entered the currency wars. i think the implications are fairly global at the top of our global risk register. it has the potential to set deflation around the world. the economic recovery is very soft in the eurozone. export led deflation of the euro has to face off against the yuan, and that is going to be difficult. they are trying to claim this is strengthening the markets role. are they going to let it play out? right.second answer is the market won't be determining this. this will be the visible hand of the chinese government.

>> you mentioned the derivative effects. does this have any meaningful impact on whether you move or not? september looks like a likely move. i think it does fundamentally affect the speed. i think they are likely to be much shallower as a result of

the potential of deflationary forces. >> this was a record cut. they would take a long-term adjustment. >> that really changed the game in terms of what we hear and what we believe. i think it would be difficult for the chinese to say anything else. say, we be logical to will slide this out. when we get to a situation where a week r&b is expected to be the driver. >> if the chinese were a .eneficiary are there any other winners area

it gets delayed further. we see asset bubbles again. are trying to tick the box so it can become a reserve currency. against this is working the imf. what do you think? how will they be interpreted? imf are assessing the criteria based on economics. there is an awful lot of politics involved.

think the assessment is based on the stability of the r&b and the dollar is not correct. i think what the imf will be looking to do, what other leaving you say you are the exchange rate, but what about losing unlimited amounts of money? is that a further move you expect to make? inthey are expected to go that direction, the imf could come down. to talk aboutg greece. we are going to talk about a lot of things. i very much appreciate your analysis. up, google spells out

a new future. we break it down. ♪

>> it is 6:14 here in london. here are the stories you need to know. >> china devalue's by the most in two decades. they cut by a record 1.9%. he triggered the biggest one-day loss and 1994. >> discussions continue into the early hours of the morning. negotiators focused on the details. >> google is reorganizing the company after a new holding company called alphabet. it gives more independence while offering more visibility and plans to expand new businesses.

>> let's get more on this. alphabet. what is in a structure? talk us through what they are doing. >> they are changing the official holding company. to look upng alphabet. that is going to tell you what your shares are. be goog.t will still the actual name that will come up is going to be the alphabet. namesay they like the because it means a collection of letters that represent language. it sounds like a bit of pr. we also like that it means onha, meaning return

investment, which they strive for. we have all of these disparate businesses, and they want to be able to have them be more focused and independent. we all know about google. that will include youtube and maps. contact lenses. calico, which is one i wasn't familiar with. they help with finding ways to make us live longer. google fiber, google ventures. i think also opportunities for sponsorship. will stand for boston

dynamics. >> what is interesting is the way they are splitting up their roles. thinking about the future. on. are passing the helm investors like it. they like the change in the guard. >> larry page will be ceo, and sergei brin will be ceo of alphabet. the best people will run these businesses. visibility, we see 60 billion in revenue a year. google provides the majority of that.

we encourage you to see how much contribution other businesses make and perhaps how much businesses strain from the organization. tos may give some pleasure investors. say wi-fiey will balloons isn't something i want google to be doing. >> thank you very much indeed. radio free to the mobile founder, richard. let'sns us on the phone. get an idea of what this means. good idea, bad idea, inevitable idea. >> less good idea. there has been considerable time for whate they call the unicorns to be stripped out of google so people can see how much they are investing. it will give much better

visibility on the core business on which they are really making their investment. it definitely gets a thumbs up. >> what do you think in terms of what transparency is going to bring? are you expecting huge amounts of money? do you think you will be impressed or slightly unnerved by the amount of money plowed into these? the answer is it will not be as much as people feared because of the numbers were going to be very big people will say, that is dreadful. the real issue is the two things the move does not address. one is corporate governance and investors input into how it will be run remains the same. of google as we

not change.y may that part of visibility will not change at all. i would have to put the brakes on the idea. quite frankly, it has got to a point where it is looking much more fairly valued than it was. i would think about putting the money somewhere else. if they were to significantly reduce expenses there is more upside. at the moment it looks fairly valued. >> in terms of who is going to forward,g this company

do you like the fact this is being split up? they are going to be more future focused? >> i'm not sure it is making an enormous amount of difference. i think from his perspective it formalizes his position. day today is not going to change that much. still bewill controlled by the founders of the company. that dynamic is it going to change at all. >> inks for the analysis. -- thanks for the analysis. alpha aa good bet -- good bet? i guess it depends on whether you see investment long-term and

try toerm, whether you get into new spaces and try to be disruptive. becausepeople take this the earnings are so good. longer-term, do we like this transparency? >> is it a good bet? would you put your money into this company? >> they are spending $4.6 billion on the stake in order to bolster the e-commerce giant. why should alibaba want to do this? what does it ring to the table his new acquisition? >> the core confidence comes from the selling of consumer electronics. that is something alibaba has tried to play catch-up on.

that strikes at the heart of its competitor. this is the largest acquisition alibaba has ever made. having that stake would help alibaba get that extra push into these areas. prices were up in terms of valuation. theill have to see how collaborations are going to carry forward. >> they were going into retail space is. how will these companies work together? >> there is a lot they can work on. alibaba wants to expand its network.

300 cities inmost china. as alibaba moves forward into the smaller ones and rural areas, warehouses, storefronts, and also with cystic centers could get that push to reach some of those places in terms of in a fast as two hours. >> what does this mean in terms of overall strategy? where is this acquisition going to take it? does it change anything? >> that's an easy question because alibaba has become so much more than simply an e-commerce platform. stretched in so many sectors. if you really wonder what they want to become, but they still want to remain in the platform. that is the core of the strategy. >> thank you very much indeed.

>> twitter closed after it unveiled a deal with the national football league. dorseyf executive jack promoted the purchase with a tweet. the cfo also bought shares last week. what is talk about coming up next. we are going to put our money where our mouth is. we are going to talk about what is happening in china. about going to be talking the head of equity strategy. he is going to give us his take. we show you what it looks like. this is the onshore r&b.

this is the onshore move. it gives you the idea of the scale of the move we are looking at. we are back in a moment. ♪

caroline: here are some of the top stories. >> greece is closing in on the third bailout. they focused on the details. >> google is be organizing the company after a new holding company. the new structure gives more independent while offering more visibility to expand new businesses. shares jumped in after hours

trading. >> china has devalued by the most in decades. the move triggers the yuan's since 1994.day loss >> we are not changing our focus. stephen, so glad to have you here. it was your take away. you want appreciation. what drove this? this more,rt, or was we want to be a reserve currency? >> i would say there are two main drivers. first we have the imf. i think if you look at what they have announced, a lot of it is aimed at placating some criticisms from the imf.

the trade numbers have been this up pointing. -- disappointing. as the dollar has appreciated and most of the asian currencies have weakened in response, the renminbi has flagged. stronge seen relatively renminbi. about this around the world. are the implications for the eurozone? what are the implications for the u.s. economy? >> i don't think there is going to be a huge movement. the market has been -- has been speculating for some time. it's dramatic. thates back to the fact

you see a general trend of asian currencies the appreciation. a theme we saw in the market. we have a rising dollar. that perspective, i think it brings china into line with a lot of asian currencies. >> talk about the implications. we have seen the dollar down 1%. why are they just anticipating this move from china? will the dollar remained celebrated? >> that's a good question. up on theke to pick australian and the new zealand dollar in particular. they have weakened. i think that is the right way to look at this. the fact that the chinese have

stimulus the route to through the exchange rate probably means there is less need for monetary easing. given the strong focus on exporting into china, that could reduce demand. i think this adds to the downside. >> we came in this morning. this was something we saw as a real top headliner. is that inevitable that this was something that was always going to happen? >> know, i don't think it was inevitable. announcement on inclusion, a lot of people were suggesting the renminbi would be stable.

report from the imf, there were other measures that needed to be addressed. i think the chinese could quickly address some of these issues such as allowing a more determination of an exchange rate. >> this is a thumbs up. you would think it would be different in terms of how it is owing to be interpreted. the market really is going to have it say now. >> i would suggest it is seen as positive because it doesn't address some of the criticism. remember, china was hoping for an earlier in lesion. particularly in october of this year. the imf report pushed it that. time thaten some there were specific factors that drove that delay. this is china's way of trying to

address. plaques let's go back to this issue of monetary policy versus the currency markets. are you saying there is going to be less monetary policy or no monetary policy as a result? >> i think what it does is take the pressure off. we know there is a growth issue in china. there are two choices they can do. ory can lower interest rate go down the currency route. we thought in the currency environment because of the we thought it would be the monetary policy. i think it takes the pressure is as far as easing

concerned. >> does that mean they don't do anything else at the moment? i think the point i would make is this is the stimulus that is going to help exports. >> it seems to be for everyone youent move and the yuan get a 1% uptick in exports. is this enough? are we going to see a continuing depressurization? that's i think you could see that. there could be a little bit more movement here. the chinese have highlighted this is a one-off move. they are not suggesting they are going to make step adjust it's like this. -- adjustment like this. >> the market would move ahead of it. >> i don't think they would jump to that conclusion. the point i think we need to

focus on is they have highlighted this is being a one-off adjustment. some of the adjustment is aimed at the criticism of the imf. convenient it brings a more liberal approach. from that perspective i don't think the market is expecting further steps going forward. >> let's turn our attention to japan. the number one react or are. >> what does this restock make.

did they have a choice of trying to restart the nuclear program? you have the time to manage prices. allowed the commercial increase. these are regulated. the government did not allow so it means the utilities are basically underwriting the , whichs being off-line means they were bleeding red for the past three years. >> this is fascinating. less poweraybe a few

cuts, but what about the impact on international market? >> very good question. japan is isolated. it is an island country. what we are talking about is demand for uranium and natural gas. uranium prices were about $70 per pound. year most traders were expecting it would increase demand. prices would gradually pick up. we are right now on a very low cycle. japan's power sector is the largest in the world. it will have reduced demand from

japan. what it means is you are looking fiveft prices for the next years. >> the ripple effect is huge. talk me through the impact it is going to have closer to home in europe and other parts of the world that use nuclear as well. angela merkel significantly shifted the energy policy as well. >> nuclear is much more than a local issue. there is no incident. it increases confidence in the industry.

in europe it is much more about cost overruns. we are planning to use nuclear technology. it remains to be seen if they time.liver it on some eu members have questions. they are considering taking the u.k. over the support of the project.

some firing upg of the nuclear reactors back in japan. and we will stick with the theme of how this could be affecting japan. >> we were talking about gas prices. prices were likely to have a deflationary effect. abenomics is fascinating. >> it is interesting. there is a lot of pressure on the authorities in japan to cut down the power plant. consistent with what they have wanted to do. japans interesting for and the yen is the surplus.

recently it has gone into deficit. a lot of it was importing energy. investors suggested it changes the view of the yen over the medium term. japan is now back. we are pretty close to the large one at the eurozone. guy just mentioned abenomics. acause of the avon him expel see that keeps yields extremely low in japan, it encourages investors to seek yields. despite japan going into a large strong, there is a demand for japanese investors to go abroad. that is the theme that is weakening the yen. >> somebody told me yesterday you speak fluent japanese.

is that right? >> correct. >> that is an achievement. up,ust to briefly wrap this when you think about how this fits in, this is an unpopular policy. do you worry about the politics story? >> i think there has been some time here now. when i go to japan and talk to people about this, as long as there is a strong commitment it is being improved, i think the japanese people will accept this. >> we have interesting movement into the euro. news thereaking details remain. a greek government official is sayinging at the moment,

the discussions have completed. you are positive in terms of a deal being done today? i think we are very positive on a deal being done in greece. it is not in anybody's interest for greece to leave the eurozone. i think there is huge commitment to keeph sides to try greece in the eurozone. there is always political , theure from the europeans french and germans to get the greeks to commit to make concessions, where the greeks tend to push back against that. there is always negotiating.

it is a difficult question. i would say, can the europeans work out a deal that will allow greece to remain in the eurozone ? my answer to that is very much yes. caroline: do you think the imf will capitulate? which one will give up on debt? it is sustainable for greece but horrible for voters. i think that is the key point. a have to do a very good job of selling it to the german people. what is holding this up in the past is the germans believe the greeks are getting a free ride. it is important to show willingness. we have got to take a break. we will be back in a few minutes time. please stay with us. finds no's recession

bottom. we will give you the latest growth figures as evp shrinks the most since 2009. -- gdp shrinks the most since 2009. ♪

>> speaking on behalf of tom keene yesterday. more on that exclusive interview on bloomberg.com. .ex china devalued the yuan record 1.9%. a it triggered the biggest one-day loss. >> google is reorganizing.

shares drop sharply. u.s. economy has made enough progress to warrant raising rates. even if indicators are mixed. his comments came as the fed continues raising rates. indications that the official talks on the first bailout are complete. details to sort out. let's get more on this. what do we still need to find out about this? what have they done, and what have they still got to do? >> we don't have all the details. we have news there has been an agreement. that is good news.

we were hoping to have something today. the greek finance minister was saying we might not have something this morning but soon. it looks like they have agreement on the primary budget talents figures for this year and the next two years. they were looking at details of the privatization fund. we will be getting more on this as we go forward today. >> are we expecting an official word to be coming out? is there a timeline to be able to sign the deal off by august 20? billions need to go out to the ecb from greece. shape tould be in good meet the august 20 deadline to make the payment to the ecb, but we still need a couple things. the greek parliament needs to pass the measures agreed and goingand the eurogroup is

to meet. we think they will meet on friday to assess the situation and hopefully sign off on it. we have the greek parliament that needs to weigh in on this. merkel is going to have a meeting tomorrow, and of course she will be talking about this as well. we will see the german perspective going forward ahead of a meeting later this week. >> thank you very much indeed. it looks like a deal surrounding greece. thanks for joining us from brussels. >> let's look at the russian outlook. the economy shrank the most a forecastafter the country drag into deeper recession. clearly bad news. where is the russian economy headed?

is this the bottom? >> i think the answer is nowhere good. too alarming pieces of information. they came in worse than expected. worse than we saw in the first quarter of the year. the underlying reasons are pretty alarming. investment is down. consumer demand is down. have been passing on the higher prices to consumers. the bigger problem for the russian economy is what might happen now. economy saying the could get as much as 6%. won't -- the lowest point won't come until the fourth quarter. this second quarter would be the lowest point. there are a lot of people wondering about that.

>> let's talk to our chief energy correspondent. fronts an energy story and center. how bad is it for russia? >> let's not forget about it. oil prices have been falling for almost a year. prices russia received an index against the oil price. it is january, february oil prices. they are getting a real double negative impact. very low gas prices. opportunity. the outlook was looking better with analysts lowering the forecast for oil prices. to oild to gravitate

prices of $50 or $60. putting that in perspective. >> we are back in two couple minutes. we will see you then. ♪

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seen significant moves around the world in terms of currency. the aussie has fallen. the euro also down. >> greek bailout talks complete according to a spokesman. details remain. >> google searches for a new future. >> welcome. let's focus on the top

headline. obviousussie is the one. we have the yen down. you can take it out a little bit further. this is the dollar versus the onshore chinese yuan. it is only a 1.85 move. chinese currency has been appreciating for some time. let's show you the story. you can see this. this is the dollar strengthening. maybe the chinese are just beginning to push back a little bit. >> it is more than eight percent.

they want to become a reserve currency. >> it looks like we have got a deal done. we will come back to that. they are creating a holding company. back to that valuation. >> we're looking at how the valuation is weighing on the session. spell out how this is looking. >> the ramification is most clear in the currency market. it is having an effect on currencies. commodities as well. let me check on the equities market to give you an overall snapshot. this is a significant move.

they are clearly worried. that is why they have taken this big record move. as you showed on the chart, that shows the ongoing move. check out the aussie dollar. that the south korean won moving 1%. this is moving in terms of the commodities market. expectation china's

resources will be lower than we have seen in the past. the eight shares, chinese companies listed have held up in the wake of this announcement. a 13% drop in the a share market. that is one example of the kind of dramatic movement we are seeing in the forex market. a big day indeed. this reflects the alarm in beijing. >> we have the biggest valuation in two decades.

export numbers we have seen falling. >> we may need a bit more depreciation to give exports a big pop. saw exports were down. this will make chinese goods more competitive again. atdoes seem to be aimed boosting those numbers to help the government hit its growth target of 7%.

the estimated the growth was 6.4%. >> is it about trying to placate the imf and become a reserve ?urrency thehey really couch this in language of market reform. they put this as a broad plan that has been in discussion a couple years. hand, the benefit is obvious. this will make exports much more dependent. there has been pressure to depreciate the currency for some time, but it was only recently the imf changed its own assessment of the yuan, that the yuan was undervalued.

given the imf only recently changed its assessment, the currency may be met with some suspicion by the imf and investors. this may unnerve people. >> i want to get a look at the data. credit not going into the real economy. how worried are people about the >> i think ity will help. a depreciationy

of currency takes about six months. it's not going to produce something right away. it's interesting. remember, the u.s. dollar started to rally dramatically from the middle of 2014. china didn't really join in. there wasn't much appreciation, but we saw the dollar rising the most in asia. as far as what this means for other currencies, the three we our korea,int singapore, and taiwan. are likely to move in response. >> the idea was that china was going to move for more andumption led structure

effectively by appreciating the currency they were putting money into profits. as a result of which you would make this happen. where does that leave this idea? >> i think that was the idea of the market as well. china's goal of seeing the renminbi because -- become a reserve currency requires stability and confidence in the currency. what i don't think we need to see in china is a competitive devaluation or a trend. very important to couch this the way they have. it is aimed at market reform. i think that is very important. going to not suddenly see a lot of central banks making moves on the back of this? asked i don't think so.

those currencies are most correlated to this. the most probably move in response. >> thanks very much. we are going to take a break. we look like we have got a deal this morning. >> we have got a new name. it is going to be called off the bed. good that?a good bet? .

but claiming global warming is

real is rejecting science and matters of set their been noted temperature change for 19 years this nobody responded that this is am really awful thing but women maybe bit parks here arent some top stories. chinathe people bank of loudly held its rate.

>> google is reorganizing the company after a new holding company. the structure gives more independence by offering more profitability. reserve president said the u.s. economy made enough progress, even if new economic indicators. his comments come as the fed raises rates for the first time since 2006. >> talks are complete. what do we think needs to be ironed out? >> we still need to get the details.

says somee ministry of the small details remain. this is one of the key sticking points. >> give us a sense of the timeline on this now. hurdles that have to be got over? >> there is a payment due on august 20. they will be on course to make that. before that can happen we need to have this signed on by the eurogroup. they are expected to meet as early as friday.

merkel is going to have a cabinet meeting tomorrow. they will talk about this. we will have to see what they say about it. they want to change the size of -- disbursement, probably possibly reducing them to give more leverage. still with us. there are certain things that are going to be really affected. >> the first point is i don't think the euro dollar is going to be driven by greece. remember, during the crisis when we speculated the greeks might leave, the euro-dollar is rallying. this is different from three years ago.

there is a currency that is very driven by this. saw during the crisis was a very strong swiss bright -- swiss franc. see we started to see the swiss franc strengthen. we get inside. the swiss franc was even longer than the dollar on expectations of the fed hiking. since theappened is greek stress has reduced, the market or investors have unwound those. we think this is a direct response to greece. action inbeen some

the market. with greece out of the way we can see euro swiss starting to rally. this deal suggests we are going to get there. watchmakers sigh a sigh of relief. think greeceou to be significant? is it something we can put on the back burner? we still have hurdles. is this something they are going to be watching now? think it will be on traders minds. we thought the worst was behind us. it has come back again.

for now it is on the back burner, but it may come again. >> stay with us. plenty more still to come. >> russia's economy shrank the crisis.ce 2009 after a is this the bottom? >> that is a big question. numbers come in worse than anticipated, but it is the underlying reasons that have people alarmed. you have less industrial production. both of those came in shorter than expected. consumer demand came in behind expectations. devaluationruble

and importers passing price carryingto ruble consumers. the big concern is where do we go from here. be the low point. a lot of people aren't convinced of that. contraction will be more than 6%. hsbc thinks it won't come until the fourth quarter. itone really knows because depends on the price of oil. dragging economic fortunes down. back to you. central bankshow are going to deal with all this. what it is likely to mean to the

ruble. expectation is that the ruble is going to go lower. it is retreating a little. why? oil is retreating a tad today. that's something they can't control. the chairwoman of the russian central bank talks about the currency.

they certainly don't want a lot of volatility. control the price of oil. commented people are changing from ruble into hard currency. oh about $65anks billion in debt by the end of the year. a statementmet with that only 31 billion has to actually be repaid. the government has been buying foreign currency. they stop that. most of it is an oil story. they have little control over that. theme's stick with this of 4.6 dropporting

in gdp. the countryimate and did a recession in the first quarter. here is chris. thank you for joining us. about what the numbers out of russia's say. is it going to be even worse? >> it will be broadly similar for the quarter. the first quarter is very weak. the pattern is still following more or less what you expect. it is no longer about this year. we are at the bottom.

it's a question of what sort of firepower they can employ. that doesn't look good. >> we think the trend is down. >> what can the government in russia do? >> right now the strategy is survival. they are talking about import substitution. >> it is helped by the ruble. >> that is an important point. this is the most important

policy change we have seen. we saw that is a sign of well-being. government having adopted the policy. >> inflation is dropping really sharply. it doesn't cut rates. it actually raises rates. aggressively.ut we were expecting they might come down to 10%. a we grew does influence inflation.

-- a week ruble does influence inflation. with inflation. they are surviving this crisis. they are saying russia can pull back from this trajectory the next couple years. oil. is a question over expect iteason to doesn't get much worse. >> thank you very much. thank you very much indeed.

and thanks of course to the head of strategy. guy: coming up, google spells for the tech giant. when we come back. ♪ the only way to get better is to challenge yourself,

and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about.

i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. guy: welcome back. it is 7:30 a.m. the stories you need to know. francine: china devalue -- caroline: china devalue the yuan by a record 1.5 percent. the move triggered the biggest one-day loss is 1994. guy: greases creditors have agreed to a bailout deal according to a greek finance minister. the talks ramped up or earlier. the finance minister told a local broadcaster very small details remain. caroline: the--

bank of atlanta said president said of america has made enough will. -- enough will spare reared raising -- made enough moves. how it is in the asian section. chinese story front and center. us.edgar joins zeb: absolutely, a big story. the world is taking note of. sure up an abrupt devaluation rippling not only the asia-pacific but in europe as well impacting commodities on the prospect of revised lower demand from china. what is happening in the equities space. shanghaiseeing the composite rotate. trading higher by 0.25. tumbling.try groups

airlines, for example. airasia is down. the hang seng has maintained of the game. china's trading partners around the world may view this with the skepticism because biggest emerging market moving to protecting itself against the downward spiral, the export he a dismal numbers over the weekend. -- of the exports. -- dismal numbers over the weekend. as a yuan dropping the most in 2 decades. houston never get some currencies have fallen. 1% declines and the new zealand dollar, for example. the aussie is down 1%. the south korean won has moved down. clear impact on trading partners. the economist are saying it will take additional devaluation here

to manage the slumping exports. that's what the chinese government is getting at. the market impact felt occurrences and commodity -- currencies and commodities. kuan we are watching closely and reflects the concern. -- it is something we're --ching closely a refax reflects the concern. we will see what it means for trading partners around the world. caroline: zeb eckert, thank you. we are seeing autos are down and luxury companies called down. china auto sales out. it will have an impact on a bmw and daimler. we are around 27 minutes away from the market open. fair market evaluation. probablyare seeing is the equity markets, footsie and cache footsie -- ftse and

are down. slightly negative open. caroline: techno. google is reorganizing the door holding company called out for that. the holdinging company called out for that. alphabet. what does it actually mean for the company? elliott: it has been a conglomerate for some time and all of the disparate buildings. allows investors to get a better handle on what google is doing with their money. and where all of the money google is making about $60 billion is coming from. googlemple, you will see

google one company, fiber in networks, life sciences and contact lenses that will detect glucose in your body. google ventures that advance. help uso find ways to live longer. the moonshot idea like driverless cars. delivery known as wing. guy: what does it mean for investors? elliott: depending on how much transparency they get, we want you to get a better understanding of what we are doing without giving away trade secrets. investors will hold to get a better handle of how each business is doing and whether it is a we'll drill down on how much revenue each is making. and give google a better currency at which to carry out acquisitions as spinoff.

when you think about how competitive it is an silicon valley, people, the top talent and trying to get out hold of the best talents. it is cutthroat. it could allow google to reinvent part of his business and go back to being the start up. new employees and perhaps a better way of attracting top talent. maybe thinking about going to facebook. caroline: sergey brin, ceo of google, the services company we knows. .ivide and conquer they are feeling perhaps larry page and circuit brennan will be the -- sergei brin will be the ceo and president. he keeps the juggernaut of going. elliott: the other thing is she noted here how these businesses are doing. surely if they cannot be doing that badly -- as they can --

surely they cannot redo doing that badly. driverless cars surely not going to happen. some of the naysayers who are careful. nothing to do with the core business. in his blog page yesterday, you have to be a little bit uncomfortable to remain relevant. perhaps it may not be comfortable. a transitional but google hopes it will keep them at the top. guy: you think they have sat down? caroline: as they like it. -- they like it. nds sounds like somebody from the pr department section.

they like a because it means return above benchmark. shares up above 25%. that is above benchmark. caroline: people like it. thank you. guy: coming up on "countdown," still in the deal with the greek officials saying bail out talks are now over. does it mean we have an agreement? the detailed left a sort out still. also a problem. -- the details we have to sort out still. ♪

duty is to the american economy. but what happens abroad a sex us. the united states economy. -- what happens if facts us. -- but what happens

affects us. isthe rest of the world slower, not good for the united states economy. guy: dan fisher. -- stan fischer. he was brought in. a great interview. caroline: the rate of inflation. [indiscernible] how about implications for the fx market yesterday? all the better off now. moves and the dollar because of china. guy: the stories you need to know about. by theevaluing the yuan most in 2 decades. triggering the currency's biggest one-day loss system

identity four. caroline: google is reorganizing under a new company called alphabet. it gives maynard webb operations more independence while offering investors more visibility. check --hnson -- shares jumped. guy: a finance minister from greece said very small details remain. caroline: the devil in the details. welcome. elliott, what do we know? elliott: they have reached a deal. and the finance minister it need to be sorted out. $86 billion and they reached agreement on the surplus. -.25%. a deficit for this year. rising. great parliament, due to vote on

this today. as part of this deal, 35 previous measures. more degrees had agreed to but had not implemented which still needs to be implemented before this disbursement can happen in october. bank recapitalization clamping down on early retirement. additional requirements went further pension of systems. through quiteget a lot. we goes another opportunity for rebellions and parliament and primus alexis tsipras' own party. perhaps the very first one or two hurdles in parliament. maybe one or two defections and cabinet reshuffle need to take place to make sure loyalists in the cabinet. seems to be moving in the direction is creditors wanted

to. guy: thank you. , what we get to michael the markets are doing. european futures, fair valuation, an ideal we are probably opening a little down at morning. the fluency and cac look like down -- the ftse and cac look down. the big story china the ripple effect. quite strong. --aussie is down and down.nd the yen is insight on the markets. chief analyst. give us a look ahead. first?we focus on greece positive steps. guest: you said yourself the

devil in the details. do we know is at his billion dollars? -- $86 billion? elliott: that seems to be the view. that seems to be the view. that is cataclysmic. the bank probably need more capital than estimated. factor in the fact imf wants debt restructuring. how does germany feel about it? will the imf, onboard -- come on board? guy: is a the numbers low more reasonable. michael hewson: more realistic. the report of further out. i am not convinced greece will get the growth without debt restructuring. lot of still an awful long-term unanswered questions with respect to this bail out. why should it be any more successful.

the troika or whatever it's called, have not learned their lessons. caroline: the market does not jump for joy. they're only any movement in the euro. it seems to be china taking front and center at the moment. i am seeing calls for luxury companies to be called it down? greece: items -- michael hewson: i am scratching my head on this one. we should of seen it coming. china has been gliding lower. , dismal.gures absolutely dismal. when you look at what the eurogroup has done, not to release price that china had decided to move. a decline of 12.3% in the eurozone export, 12 the deck 12.1% in japan exports.

the fact that the chinese have done this. the biggest question is we have not been a rebound at commodity prices. a big rebounded yesterday. surely, this is stimulus. usually gets a positive reaction. get a.not guy: deflation around the world. saide: what mr. fischer yesterday about the fed. fischerhort-term, mr. the narrative for what mr. lockhart said. also a rotating member where mr. fischer is a permanent member. i am more minded to go with mr. lockhart.e mr. mr. lockhart is the equivalentr of the bank of england. you need second votes month. the payroll data. i do not think it matters as much now as the inflation data.

oil price below $50. guy: bank of england looking through high inflation the u.k. had and we have learned lessons from that. you think the fed will take a similar view? what a normalized rate? why should we worry about the short time right now? greece: the bank of -- michael hewson: to the bank of england to did not act so why should the said -- fed? commodity prices not just oil prices are up -- all deflationary. at some point, it has to ruble out into the core. caroline: their earnings season, u.s. companies, every single one really hit by the dollar strength. they raiseson: if rates ever so slightly, the next

question is when is the next one? they will price it then. caroline: when is the next one for china? too earlywson: it is to say. they will probably cut their required rates. this speaks to a wider issue. the fact they did it now is as they are very concerned about hitting the target. gdp. industrial production and retail sales up tomorrow. is this their sort of head's up they will be really bad? guy: maybe. talk about from the stock point of view. bad chinese data on car sales. michael hewson: probably what the dax is reacting. guy: certainly. plenty of companies, burberry been a big battle china and a significant portion of the revenue stream. do they need to start downgrading them?

michael hewson: potentially you need to look much more closely at the valuation. over the last three or four years, stocks in general the one sure bet. ,ompanies like luxury brands you are going to have to look at .heir chinese leisure also more broadly, the u.s. exposure hit by the strong dollar. the strong yuan, maybe a weakening will help an exchange rate. it is difficult to know. caroline: what are they worried about? the move to devaluation is not enough to read spark is economy or the way selling? michael hewson: i think luxury companies have to adapt to a new paradigm if i can use that. the chinese want to normalize the currency. essentially means the companies will have to adapt and the same way they doing japan, europe, the united states, and the u.k.

exchange rate volatility. as a new thing. china wants to be included. chinese ducks want to be included in it msci. -- chinese stocks want to be included in the msci. regulators how they have intervened in china wants to move that way and an awful lot of talks on the road. not to the experience we have here in the europe and asia with respect in intervening and markets. seem to be very controlling love. guy: michael, thank you. michael hewson. screen, 7.5 minutes away from the equity trading open. what we think the numbers will look like. the ftse is down. cac is down. dax is down. probably stocks under little bit of pressure.

the miss price. fair value calculation you're looking at. an idea. luxury stocks under pressure. luxury car stocks likely to be pushed a lower. caressing market reacting to what is happening in china. let's show you the board and what is happening with the currency overnight as a result. perdollar trading lower euro-dollar down 1.5%. dollar up versus the yen. assie dollar in some ways proxy for the chinese currency. the move in the chinese economy has been aggressive. caroline: up against every of them.er, 16 guy: it may have a part in fed thinking. caroline: the open with the anchor of "on the move."

probablys china google. jonathan: a bit of google and a bit of greece. all about china. though most on record. the biggest one-day loss in two decades. about market discipline or alleviate the pain of the exports? the market, "purchasing power." the commodity, the likes of copper. it makes imports more expensive. look to aussie in kiwi. weaker trade. and thel ripple effect clare market ripple effect as well. discussion quite obvious. we will break it down. should it be bullish? well thatfx notice as loosening policy by the fx is very different video monetary policy. loosening monetary policy would be bullish. the fx channel, very different.

a subtle nuance but it matters. we will talk about it. guy: talking yesterday to stand fisher -- stan fischer. feeds into aems -- form see. jonathan: something we have to talk about. guy: i'm sure you will be talking about greece as well. a few more headlines. the deal is done. greece kayla bankgreece's creditor -- caroline: greece's creditor's agreement new deadline. guy: on the move is next. we will see you tomorrow. ♪

jonathan: good morning the welcome to "on the move." "on the mov i am jonathan ferro. yuan devaluation. the people's bank of china slashes the currency. the biggest one-day loss in two decades. google becomes alphabet. a conglomerate as it searches for new future. the stoxx soar. deal. talks between greece of the creditors go into the early morning hours. they agree with terms on a third bailout. i will break down those stories. 20 seconds ahead of the open.

by 30tures of -- off points. is china.eme caroline hyde. caroline: phenomenal moves area that record move in the yuan. a devaluation to the tune of 1.9%, the most in 2 decades. it moves across asset classes and everybody knowing china is trying to boost exports. is it trying to tap into the imf? to ensure it will come to reserve currency? the special digital area for china. it is having an effect on the market. cac 40 is often by zero .3%. it is going to play in stocks in europe. he trading partner. look in luxury and cars.